NRC Issues Subsequent License Renewals for First Time to Nuclear Reactors in Florida

LCG, December 11, 2019--The Nuclear Regulatory Commission (NRC) staff recently approved Florida Power & Light's (FPL's) application for an additional 20 years of operation for Turkey Point Nuclear Generating Units 3 and 4. This is the first time the NRC has issued renewed licenses authorizing reactor operation from 60 to 80 years. The subsequent (or second) license renewals (SLRs) for Turkey Point Unit 3 and Unit 4 now expire on July 19, 2052 and April 10, 2053, respectively.

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New York Poised to Close Last Coal-fire Power Plant

LCG, December 4, 2019--The last operating coal-fired power plant in New York is moving toward closure shortly. Last month, Somerset Operating Company, a subsidiary of Riesling Power LLC, submitted a request to the New York State Public Service Commission (NYSPSC) to waive the state's required, 180-day notice to close the Somerset Station, allowing the facility to be retired on February 15, 2020. Closure is contingent on approvals by both NYSPSC and the New York Independent System Operator (NYISO), which will evaluate if it will cause an adverse effect on grid reliability.

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Industry News

Dynegy Covers Backside in Enron Deal

LCG, Nov. 13, 2001--Shares in Dynegy Inc. continued their strength this morning as the company revealed the extent of the financial protection it has secured as part of a $10 billion rescue bid for Enron Corp., the Financial Times reported.

Chuck Watson, chairman of Dynegy, said: "We are absolutely adequately protected, but I am confident we will not need it." The ultimate protection is, the company has the right to abandon the deal if Enron's earnings are revised down by more than 10 to 15 percent.

Under a number of material adverse change clauses, Dynegy has also negotiated a range of other conditions relating to balance sheet impairment, off-balance-sheet exposure, credit rating downgrades and the outcome of a Securities and Exchange Commission investigation, the paper said.

Dynegy could walk away if Enron's legal liabilities topped $3.5 billion, and the smaller company has also taken into consideration that "off-balance-sheet liabilities" bring total debt to $20 billion, including $15 billion of on-balance-sheet debt and preferred stock.

Dynegy has also estimated that the international assets need to be written down by $5 billion and the broadband assets by $500 million to $600 million, according to people close to the negotiations. In addition, accounting for the takeover as a purchase makes it far easier for Dynegy to do the write-downs.

According to the Financial Times, the most important part of the cushion is price. "The biggest protection is, we bought Enron for $10 billion -- or $8 billion or $9 billion. Who's counting?" Watson said. "That is a major protection."

The paper said that more than half of Enron's 20,000 staff could be cut as the once-mighty company completes key asset sales of the businesses -- outside core energy trading and marketing -- that have used up cash in return for low-quality earnings.

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